I think the worst part was trying to use a game like Peggle to prove his point. I don't think anyone ever purchased Peggle and felt like they got the short end of the stick because of lack of emotion.
I was reading an interview he conducted with MTV during the last GDC in 06. He sounds like a dick there too. He makes a few valid points though. His game Braid, which is coming to XBLA and PC looks really interesting. It doesn't solve his bitching about storytelling, but it has a nice gameplay twist supoposedly, and won some awards.